Alveolar epithelial cell regeneration after lung injury is essential for homeostasis. In case of impaired repair of alveolar epithelium , the inflammatory response is unchecked and lung inflammation and tissue repair do not normally resolve. Studies in this application will test the hypothesis that impaired lung repair after injury is the result of GSH/AKT signaling imbalance in type 2 alveolar epithelial cells (AEC2s) regulated by crucial redox regulatory protein, Nrf2. This transcription factor regulates gene expression required for cyto-protection and survival in response to stressful stimuli. In the previous funding period, we found that g lobal deletion of Nrf2 impairs lung repair after sub-lethal hyperoxic lung injury (HLI). To further determine the contribution of lung resident cellular stress to HLI and repair, we have developed Nrf2 floxed mice and found that deletion of Nrf2 in lung epithelium, but not in endothelial cells or resident alveolar macrophages, impaired the resolution of HLI in a manner similar to that observed in Nrf2-null mice, suggesting that lung epithelial-Nrf2 signaling plays a major role in regulation of pro-resolution response and lung repair. Consistent with this notion, we found that primary AEC2s lacking Nrf2 (Nrf2-/-AEC2s) proliferate poorly due to oxidative stress and G2/M cell cycle arrest. Interestingly, exogenous N-acetyl-cysteine mitigated oxidative stress in Nrf2-/-AEC2s, but it could not promote G2/M progression. In contrast, exogenous GSH mitigated stress, activated AKT signaling and restored proliferation in Nrf2-/-AEC2s. Preliminary 3D cell culture experiments showed reduced size of alveolospheres formation by AEC2s isolated from Nrf2+/+ mice exposed to sub-lethal (48-h) hyperoxia compared to room air counterparts, and AEC2s from Nrf2-/- mice exposed to either room air or hyperoxia formed disorganized and reduced number of alveolospheres. Nrf2-/-AEC2s supplemented with GSH exhibited improved alveolosphere formation, but not efficient AEC2/1 trans- differentiation. Thus, we hypothesize that AEC2-specific Nrf2 regulated signaling is essential for tipping the equilibrium towards either for optimal GSH/AKT-dependent AEC2 proliferation and GSH/AKT-independent AEC2/1 trans-differentiation. We will use multiple approaches to provide a mechanistic test of this hypothesis including the use of AEC2-tissue-specific loss-of-function (Nrf2-/- AEC2) and gain-of-function (Nrf2 inhibitor Keap1-/-AEC2) mouse models and small molecule Nrf2 activators. The Specific Aims to be pursued are: 1) to determine the role of Nrf2 regulated GSH/AKT- mediated signaling in the mechanisms of optimal AEC2 proliferation and AEC2/1 trans-differentiation, 2) to address in vivo the role of AEC2-specific Nrf2 as a pro-survival and pro-regenerative mechanism after HLI and bacterial infection, and 3) to test the postulate that Nrf2 activation post-HLI or bacterial infection will accelerate AEC repair. Hyperoxia is widely used in the treatment of pulmonary diseases for veterans, but its effects on AEC repair in patients are not clearly understood. Likewise, abnormal lung AEC repair caused by bacterial infection is a major health concern of veterans. Thus, the studies proposed are of major scientific and clinical importance to veterans.